Maximum IRA Contribution Limits for 2024-2025

IRA Contribution FAQs

How do contributions work?

An IRA contribution is the money you save in a retirement account from your earned income. Contributions may be limited or have maximums for the year. It’s important to know that the total maximum contribution limit applies to all of your IRAs combined. For example, if you want to make a Traditional IRA contribution and also contribute to a Roth IRA, the total amount that you can contribute for the 2024 tax year is $7,000 ($8,000 if over age 50).

It is the same for the 2025 tax year, Traditional and Roth IRA contribution limits are $7,000 if you're under 50, and $8,000 if you're 50 or older.

Who is eligible to make IRA contributions?

To make contributions to an IRA, you (or your spouse) must have earned income. As of December 2019, there is no age limit if you have earned income. Earned income includes money from wages when you work for someone or from self-employment income.

Are IRA contributions tax-deductible?

Contributions to IRAs may be tax-deductible (except for Roth IRA). Deductions are determined by income, Cost of Living Adjustments (COLA), and if you are covered by another plan at work. Everyone’s situation is different. We highly recommend that you consult with a qualified tax or financial professional for guidance.

Can I contribute to more than one IRA or plan?

Yes. You can contribute to a Traditional or Roth IRA even if you participate in a plan through your employer or business; 401(k), SIMPLE, SEP, and so on. However, your contributions and deductibility may be limited if you (or your spouse) are participating in a plan at work, making contributions to a Spousal IRA, and your income exceeds certain amounts. We recommend that you discuss retirement planning with a tax or financial professional.

Are there income limits to contribute to an IRA?

There are income limits to contribute to a Roth IRA, however, your eligibility to contribute to a Traditional IRA is not subject to income limits. Traditional IRA deductions may be phased out depending on your income and participation in a workplace retirement plan like a 401(k) or SIMPLE IRA Plan (Savings Incentive Match Plan for Employees). Important to note: Contributions that exceed what's allowed may be subject to a 6% penalty if not removed timely (known as Excess Contributions).

What is the maximum IRA contribution for 2024?

The maximum depends on the IRA. For Roth IRA and Traditional IRA the maximum is $7,000. If you are over 50 years of age you can contribute $1,000 more (total of $8,000). For a SEP IRA, the contribution limit is up to 25% of compensation, with a maximum of $69,000. And for a SIMPLE IRA, employee contribution limit is $16,000 if you are under 50 years— if you are over 50 the maximum is $19,500. Excess amounts are taxed at 6% per year for each year the excess amount remains in the IRA.

What is the maximum contribution for 2024 if I have multiple IRAs?

There are two main types of IRAs: Traditional and Roth. In 2024, the combined contribution limit if you have both is $7,000 if you're under 50, and $8,000 if you're 50 or older.

Can my stay home spouse contribute to an IRA?

If you're married filing jointly, your spouse can contribute to an IRA, even if they don't have earned income themselves. However, your level of earned income may affect the amount you can contribute.